 from Las Vegas. It's theCUBE, covering AWS re-invent 2018. Brought to you by Amazon Web Services, Intel, and their ecosystem partners. Okay, welcome back everyone. Live coverage here with theCUBE at Amazon Web Services re-invent. I'm John Furrier, my coach, Lauren Cooney here, breaking down all the action. A lot of announcements coming out of Amazon Web Services. A lot of killer new technologies, but also the IT game is changing. Two great guests from Cisco Systems. Dave Cope, who's the Senior Director of Cloud Market Development, and Kip Compton, Senior Vice President. Cloud Platform and Solutions. We got the big cheese here. We got the marketing development here. The Cisco story, I tweeted just about an hour ago that your story is really aligned with Amazon. You had a recent announcement. The whole eternity of storage, networking, and compute is never going to go away, but it's changing. This is absolutely a big pivotal moment with on-premises activity. You guys are on-premises king at Cisco. How is this changing your business with AWS? Well, no, it's been an incredible year. Dave and I were just reflecting on it as we got ready for AWS. And it's a year where we started with people questioning hybrid, multi-cloud was kind of new. Kubernetes looked like it was going to take off. And I think every major cloud provider now has announced a Kubernetes service. Hybrid is described as a new normal. And of course, Kubernetes in containers are an almost ideal technology for things like hybrid and multi-cloud. So it's been an incredible year. And you mentioned the announcement we made three weeks ago with our hybrid Kubernetes solution on AWS. And we've just gotten incredible interest in that. A lot of people interested in that solution because most enterprises as exciting as public cloud is and as fast as they can move in that environment have things that for whatever reason are on-prem and need to stay on-prem for some period of time. So really being able to bring those environments together is critical. I got to say, Kip, I'm really impressed with Cisco's business model evolution. I've obviously been a big fan from day one, routers, power of the network. We just interviewed John Chambers just two weeks ago. Great to see the legend there. But what a great business model Cisco had with networking. Moving up the stack has always been a challenge, but since DevNet and DevNet Create, you started to see that the DevNet developer community of the Cisco ecosystem was really gravitating towards cloud. Network guys are like fickle. You either win them or you don't. They hold on to their, the network, they got to protect it. But cloud somehow changed the dynamic and cloud native, what is that dynamic there? Because you guys have now stated publicly, developers, cloud native, the Kubernetes announcement, you see a world where the network is borderless. But hybrid is the standard, whatever you want, cloud or hybrid, it is what it is. How has cloud changed Cisco so much? Well, I mean, I think not just cloud, but the network has changed. All of our customers is there adopting DevOps, and I think it's 54% of enterprises have begun a DevOps journey because it just drives innovation at a much higher pace. And we're finding in almost every industry, in order to compete, companies have to be able to move fast and deliver incredible experiences to their customers and their employees in the form of apps. And DevOps is the way to do that. And to do DevOps, you need a fully automated infrastructure. And so that I think is one of the reasons why DevNet, our developer program, has grown so much. We're really excited to see DevNet pass 500,000, half a million members of DevNet, right? And many of these are networking engineers who are learning how to program on Cisco equipment as we've added APIs across our portfolio and brought programmable controllers into the picture as well. So we're seeing that then mesh very well with cloud. Because obviously, DevOps is not just for on-prem, but it's for cloud and it's for hybrid. And as we bring a fully automated infrastructure on-prem, that matches up very well with fully automated infrastructures like AWS and enables these hybrid use cases and DevOps in a hybrid model. That's great. And I think what you're doing with open source technologies is just phenomenal as well. Talk about some of the use cases that you guys see across the industry. If you can mention customer names, that's awesome. If you can't, I get it. But I'd love to hear more about how they're applying the solution today. You know, I think there's a number of use cases. I think one thing that's been really interesting kept reflected on sort of coming out of last year into this realization that multi-cloud was real. And I think we also, there was this realization that it wasn't about just saving money to move to the cloud. That now it was about going to different cloud environments to leverage innovation that could be occurring in different environments. So one of the use cases we see is, you know, how do we maybe develop a new application on a cloud that has a unique service? Maybe like machine learning or AI that I want to leverage. We're starting to see other use cases where people are realizing it's not about lifting and shifting or moving applications. But now I want to take an on-premise resource and maybe give it a facelift with a new pool capability that resides on a different cloud. All of that by having sort of common management, policy-based governance are some of the use cases that we see. Certainly DevOps is a big one. At the end of the day, we talked about developers. At the end of the day, developers want their apps to be able to move into production. And so with DevOps, the cloud, we're starting to see this overlap between developers and IT ops now working together to be able to ensure that these new applications can be put into production across many different environments. What's the biggest challenge you guys see customers having? What problem are they trying to solve? Networking you on the network. Networking's not going the way it's evolving. What's the big challenge that your buyers and your customers have right now? Well, maybe I'll say a few words that Dave can add as well. Networking and security regularly show up at the top of any sort of survey about what's difficult with cloud. And we're very fortunate that those are areas where we have very deep portfolios and can solve a lot of customer problems. It's very interesting to me, and I mentioned this in my talk this morning, but a study we did with IDC on cloud maturity found that only 14% of enterprises had an optimized cloud strategy. And what that means is 86% are trying to improve their cloud strategy and are looking for solutions and things that they can solve. So it's incredibly fertile area for us to help our customers really take advantage of their on-prem assets, but also multiple clouds in a multi-cloud world. I think one of the realizations is the cloud is not like the cloud, it's multiple public clouds, it's private clouds, virtual private clouds. And so even traditional disciplines like security, network management, when you're trying to do that across environments that you both control and don't control, they take on a whole new complexion. And so that's some of the challenges and the opportunities I think that companies are looking for across the cloud today. Well, I think it's an interesting story, too, with Cisco, because this strength is really emerged in the security arena, and that is the one thing that people are most concerned about when they're using Kubernetes. So I think just phenomenally, that's really something that's coming together nicely. Would you say that are you guys working with the security team and really kind of making things more secure for folks to make them more comfortable in utilizing this solution, or can you talk a little bit about that? Yeah, sure, no, we are certainly working with the security team. And as a former Cisco employee, I know you're familiar with Cisco, but one of the things that's different about cloud for us is that every part of Cisco is involved in our cloud strategy, right? So as you know from Cisco and a lot of customers who work with Cisco know, we tend to have big groups inside the company that focus on certain technologies, be it data center or networking or whatever. Cloud is across all of those. And a big part of what Dave and I do and the group that I lead does is work across all of those groups to make sure that things come together for our customers. So for instance, the solution we announced three weeks ago on AWS for hybrid Kubernetes actually works with our security products that has StealthWatch Cloud from our security group integrated in the solution to give consistent security across the AWS EKS environment and the on-prem data center environment. So we very much stitching security into everything we do. When you guys talk to customers, what do you say to them when they say, okay, I'm a Cisco shop, we have a lot of on-premise, I'm looking at cloud, what do I do? How do you describe the ideal architecture and waybook for really working with cloud? For to give the customer the best choice, all the stuff that they want. What's your recommendation? How do you talk about that customer? What do you recommend? Yeah, you know, I don't know if there's a single path. I mean, that's one thing we found is it's, I hate to say it's complicated, but every customer has a different set of apps, maybe different constraints, depending on what industry they're in or what part of the world they're in in terms of data protection. They may have different on-prem estates, applications that maybe they can't move, like an old ERP system, or maybe simply investments that they want to continue to get value out of. So a lot of times we end up engaging with them or one of our Cisco partners ends up engaging with them on sort of a cloud advisory process to understand their environment. But you know, there definitely some trends that we're seeing that I think Dave and I can talk about. One is I've seen a lot more interest in how you develop new experience is in applications. And Dave mentioned it, but a big shift towards accelerating innovation with cloud as opposed to minimizing cost. And I think this is a logical maturation is people see that as a lever to be more competitive. But really every customer has a slightly different journey. Beauty and the eye, behold a scale automation, moving from the command line interface to dashboards. Yeah, yeah, with AP, all about APIs in between by the way. All right, guys, give us the final word here on what's next. You guys got a great deal going on with Amazon. Love this Kubernetes announcement. As you know, we've been high on Kubernetes since it started, but recently there's a lot going on there under the covers. Containers, good for workloads, great for inter-clouding or multi-clouding or hybrid-clouding, whatever word they're calling it these days. What's next for you guys? Give us a quick peek into the, let's come up at Cisco Live in Barcelona. What's on the roadmap? What's your budget look like? Well, I love that look. So I would definitely like to hear about it. Go on, tell us the secret sauce. Maybe I'll just tee it up and you jump in. I mean, when I look at hybrid-cloud and multi-cloud, a lot of the innovation we have seen was first really about cloud management platforms creating some degree of abstraction across clouds. And then along came containers, Kubernetes, you could develop and deploy anywhere. I think the big opportunity and challenge today is all of those have been focused on the app. Now, how do we create this fluidity of data sources across this multi-cloud world? And that's an exciting opportunity right now. How do I not have the requirement to move big loads of data around but access that data anywhere it resides to feed these new applications? So I think that's a big part of where hybrid-cloud is going. Keep your focus. You're hiring, what's the focus? What's coming on? What's the next deals you're going to do? Well, I mean, we're big on Kubernetes as you can tell as well. So you're going to see continued innovation there as well as security. You mentioned that. We think serverless is very interesting for where that could go. It's going to take some time, I think, for that to become mainstream from a developer perspective. But just to pile on to what Dave said, I mean, we started the year with like, oh, is hybrid or is Kubernetes is multi-cloud? All of that seems to be a resounding yes at this point. We're moving from creating similar environments to really starting to integrate those environments. I think what we announced three weeks ago is a good example of where we create a single control plane between those environments. Data exchange and tying that data together for hybrid. And then going from hybrid and evolving to multi-cloud. Where we have customers already saying to us, oh, wait a second, we love your AWS announcement. We remember your Google announcement. You're giving us a common infrastructure on the on-prem side that can connect to multiple clouds. That's lowering the friction, lowering the complexity, make it easier for us. Because customers are saying, look, we need to harvest all the innovation. Like, ADUS is amazing, but you know, TensorFlow at Google is like a real thing. I mean, that's the real deal for some people. And that's the point here in their framework too, Amazon is. Yeah, absolutely. So we think it's an exciting time. And you know, the pace of innovation is going to be, I think that's the, the one thing is, the future is going to be hard to predict. That's the safe bet. You guys are on it. I'm excited to see we've been down there, fist on the table for years. The TCPIP is future is right in front of you. It's called Kubernetes. Really great opportunity. You guys have a good strategy. Congratulations. Let's see how it plays out. Multi-cloud makes looks obvious. Pretty obvious. Thanks for coming on. Appreciate it. Thanks for your insight. Thanks for your insight. Thanks for having us. Live coverage here in theCUBE. Stay with us for more after this short break. We'll be right back. Wall-to-wall coverage here at AWS re-invent. I'm Jeffrey Lauren Cooney. Stay with us.